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SWISS DAYBOOK: Credit Suisse, UBS on CoCos and Oerlikon Profit

Oswald Gruebel and Brady Dougan, once colleagues and now heads of rival UBS AG (UBSN) and Credit Suisse Group AG (CSGN), are clashing over contingent convertible bonds -- a dispute that reveals how much UBS stands to lose.

Swiss regulators, spooked by the near collapse of UBS in 2008, may require the two Zurich-based lenders to sell the securities, known as CoCos, to avoid future bailouts. Gruebel has called the debt, which turns into equity when a bank’s capital drops below a certain level, “dangerous.” Dougan, who runs the firm Gruebel once led, sold the first CoCos last month.

WHAT TO WATCH: *Swiss Watch Fans Gather at Baselworld as Sales Outlook Worsens *Kepler Swiss equities conference in Zurich *Georg Fischer shareholder meeting

POLITICS & ECONOMY: *Swiss Too-Big-to-Fail proposals criticized by political parties *Hearing process on too-big-too-fail legislation ends today *Germany, Switzerland move embassies out of Tokyo, Yomiuri says

EQUITIES: *Novartis says FDA extends review of experimental COPD drug *Oerlikon returns to profit in 2010, beating estimates, sees sales growth in 2011 *Baloise cut to ‘neutral’ at JPMorgan *Zurich Airport 2010 net profit at SF138.5 mln vs SF190.6 mln *Petroplus CEO does not rule out further acquisitions, FuW interview *Kuehne + Nagel would fight financial investors and favors “strategic” investors, Capital reported *Werner Dubach holds 77% of Datacolor voting rights

MARKETS: *The SMI gained 0.1 percent to close at 6,227.03 *The SPI added 0.1 percent to 5,663.18 *The Stoxx Europe 600 Index lost 0.2 percent to 271.8 *The MSCI Asia-Pacific Index down 0.3 percent at 132.61 as of 7:35 a.m. in Zurich *Euro -- Franc at 1.2789 as of 7:17 a.m. in Zurich

To contact the reporter on this story: Giles Broom at

To contact the editor responsible for this story: Andrew Rummer at

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